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http://hdl.handle.net/10419/36713
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| Title: | | Does the tenure of private equity investment improve the performance of European firms?  |
| Authors: | | Badunenko, Oleg Baum, Christopher F. Schäfer, Dorothea |
| Issue Date: | | 2010 |
| Series/Report no.: | | Discussion papers // German Institute for Economic Research 990 |
| Abstract: | | The paper investigates whether the presence and tenure of Private Equity (PE) investment in European companies improves their performance. Previous studies documented the unambiguous merit of a buyout during the 1980s and 1990s for listed firms in the US and UK markets. This study analyzes such influences in both listed and unlisted European firms during 2002-2007. Our analysis suggests that shortterm PE investments have, on average, a detrimental effect on firm performance. The performance of a firm that has PE backing is lower than that of a firm without PE backing in the first year of PE investment. Such an effect disappears if PE investments remain in the firm for an uninterrupted six-year term. |
| Subjects: | | Private equity financing corporate finance |
| JEL: | | M14 G24 G34 |
| Document Type: | | Working Paper |
| Appears in Collections: | | Publikationen von Forscherinnen und Forschern des DIW DIW-Diskussionspapiere
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